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Income Tax Appellate Tribunal, DELHI BENCH ‘B’ : NEW DELHI
Before: SHRI R.S. SYAL & SHRI KULDIP SINGH
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH ‘B’ : NEW DELHI) BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER and SHRI KULDIP SINGH, JUDICIAL MEMBER ITA No.74/Del./2011 (ASSESSMENT YEAR : 2004-05) Caritas India, vs. ITO (E), Trust Ward III, 1, Ashok Place, New Delhi. Near Golendakkana, New Delhi – 110 001.
(PAN : AAATC0399L) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Gaurav Jain, Advocate REVENUE BY : Ms. Rachna Singh, CIT DR Date of Hearing : 16.11.2016 Date of Order : 21.11.2016 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : The Appellant, Caritas India (hereinafter referred to as ‘the assessee’) by filing the present appeal sought to set aside the impugned order dated 26.10.2010 passed by the Commissioner of Income-tax (Appeals)-XII, New Delhi qua the assessment year
2004-05 on the grounds inter alia that :- “1. That the Commissioner of Income Tax (Appeals) erred on facts and in law in upholding the addition of Rs.60,78,39,283 in respect of donations received for providing relief to the victims of earthquake in Gujarat
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deemed as income of the appellant under section 12(3) of the Income-tax Act, 1961 ('the Act'). 1.1 That the Commissioner of Income Tax (Appeals) erred on facts and in law in not appreciating that the impugned amount of donation, aggregating to Rs.49,80,51,533, was not liable to be deemed as income under section 12(3) of the Act, since the appellant has filed a petition before the Central Board of Direct Taxes with a request to condone the delay in filing income and expenditure account along with Form 10AA before the prescribed authority viz. Director of Income Tax (Exemptions). 2. Without prejudice, that the Commissioner of Income Tax (Appeals) erred on facts and in law in not reducing the addition made in the assessment order by an amount of Rs.10,97,87,750, since the amount of donation received from abroad during the relevant year was incorrectly taken at Rs.55,20,79,607 instead of actual amount of Rs.44,22,91,857. 3. Further without prejudice, that the CIT (Appeals) erred on facts and in law in not deleting the addition of Rs.44,22,91,857 on account of donation received from abroad. since the said donations were not given by "assessee" referred to in 4. section 80G(2)(d) read with section 2(7) and were, thus, not covered by the provisions of section 12(3) of the Act. 5. That the Commissioner of Income Tax (Appeals) erred on facts and in law in not deleting the interest charged under section 234B, 234D and reversing the action of the assessing officer in withdrawing interest under section 244A of the Act. 2. Briefly stated the facts of this case are : return of income filed by the assessee qua assessment year 2004-05 was subjected to
scrutiny. The assessee is a registered society carrying out its
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activities in accordance with the aims and objects enshrined in the
memorandum of association. Assessee society during the year
under assessment received foreign donation of Rs.55,20,79,607/- and local donation of Rs.5,57,59,676/- for relief to the victims of
the Gujarat Earthquake. Assessee claimed that so far as donation
of Rs.55,20,79,607/- received from foreign donors is concerned,
the foreign donors are not covered under section 80G of the
Income-tax Act, 1961 (for short ‘the Act’) they being not assessee.
However, this contention is not accepted by the AO in the light of
the provisions contained u/s 5 of the Act as the assessee has failed
to lead any evidence that donors are not an assessee. AO also not
accepted the claim of the assessee, “that the donation of
Rs.5,57,59,676/- from local donors being not taxable”, on the ground that the amount has been utilized for relief of Gujarat
Earthquake victims, because the assessee has failed to furnish the
order of the prescribed authority in the prescribed manner and by
invoking the provisions contained u/s 12 (3) of the Act for deeming
the donation of Rs.5,57,59,676/- as taxable income. AO assessed
the deemed income under section 12 (3) at Rs.60,78,39,283/-.
Assessee carried the matter before the ld. CIT (A) by way of
filing the appeal who has dismissed the same. Feeling aggrieved,
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the assessee has come up before the Tribunal by way of filing the
present appeal.
We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and
orders passed by the revenue authorities below in the light of the
facts and circumstances of the case.
At the very outset, the ld. AR for the assessee has not
pressed the issue regarding donation of Rs.55,20,79,607/- received
from foreign donors having been made taxable as per section 5 of
the Act.
Undisputedly, the assessee has received donations during
Gujarat Earthquake which was to be spent on or before 31.03.2004
and accounts were to be furnished before the DGIT (Exemptions) on or before 30.06.2004 which has not been furnished. It is also
not in dispute that assessee moved to the competent authority by
filing a petition for condonation of delay, which was rejected and
then assessee approached the Hon’ble High Court which has
opined that the competent authority has power to condone the
delay and has set aside the order to Central Board of Direct Taxes
(CBDT).
CBDT by exercising powers u/s 119(2)(b) of the Act
authorized the Commissioner of Income-tax (Exemptions), New
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Delhi to admit the Form No.10AA of the Act in case of assessee
for AY 2004-05 as form filed by the due date u/s 80G(5C)(v) read
with section 80G(2)(d) of the Act to deal with the returns for that assessment year on merits and in accordance with the provisions of
law.
In the backdrop of the aforesaid facts and circumstances of
the case, the sole question arises for determination in this case is:-
“as to whether the assessee has got the right to furnish the accounts qua local donations received by the assessee company for assessment qua AY 2004-05?” 8. The ld. DR opposed present appeal on the sole ground that
since the figures of foreign donations and local donations claimed
by the assessee society are not tallying with the figures of amount
mentioned by the AO in the assessment order, the grounds of appeal need to be amended. However, we are of the considered
view that since the factum of donations received by the assessee for
Gujarat Earthquake victims is not in dispute, the clerical error crept
in the grounds of appeal or in the order of the AO, as the case may
be, may be looked into by the AO at any point of time.
In the light of the aforesaid facts and circumstances and the
fact that the relief is declined to the assessee on the sole ground
that the assessee has failed to furnish accounts to the prescribed
authority in the prescribed manner and consequently considered the
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donation of Rs.5,57,59,676/- as deemed income u/s 12 (3) of the Act, the AO is required to decide afresh after taking into account the account furnished and approval granted by the competent authority since the assessee has been granted permission by the CBDT, the competent authority, to admit Form No.10AA in case of the assessee for AY 2004-05. Consequently, present appeal is allowed and case is restored to the AO to decide afresh and he is also to verify the actual figure after providing an opportunity of being heard to the assessee. 9. Resultantly, the present appeal is allowed for statistical purposes. Order pronounced in open court on this 21st day of November, 2016.
Sd/- sd/- (R.S. SYAL) (KULDIP SINGH) VICE PRESIDENT JUDICIAL MEMBER Dated the 21st day of November, 2016 TS Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.CIT-XII, New Delhi. 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI.